White House Executive Order Snares Fee Disclosure,
Advice Regs

January 22, 2009 (PLANSPONSOR.com) - An executive
order signed by White House Chief of Staff Rahm Emanuel,
ordering a temporary moratorium on new federal rules, will
mean a delay in issuing two U.S. Department of Labor (DoL)
fee disclosure regulations.

Emanuel’s January 20 order may also put off the
implementation date of the DoL’s recently released
final rule governing the provision of investment advice
to retirement plan participants (See
DoL Finalizes Rules
on Investment Advice
).

A Washington Post news report said agencies were
ordered to pull back all proposed or final regulations
that have not been published in the
Federal Register
so they can be “reviewed and approved by a
department or agency head.”

Forall final regulations published in the
Federal Register but not yet in effect, except for those
impacting health, safety, environmental, financial, or
national security matters, the Emanuel memo asked
department and agency heads to consider putting off the
effective date.

Both were still reported to be in process at the
federal Office of Management and Budget (OMB) – which has
to approve new federal rules – but had not been published
in the Federal Register by Inauguration Day.

The advice rule was published January 21 and was
originally scheduled for a March 23 effective date.
T
he rule implements the new statutory exemption for
investment advice added to the Employee Retirement Income
Security Act (ERISA) by the Pension Protection Act (PPA)
and a related class exemption.

The Washington Post said the directive has become
a tradition among presidents going back to Ronald
Reagan in 1981. The newspaper pointed out that George
W. Bush and Bill Clinton had similar orders issued at
the outset of their administrations.

Gloria D. Della, spokeswoman for the DoL's
Employee Benefits Security Administration (EBSA), said in
a statement that the advice rule and regulations
governing two EBSA forms were too far along in the
process to be pulled back. The department
is otherwise continuing to work to implement the
White House order, she said.

"Upon receipt of the memorandum issued by the
Chief of Staff, career officials at the Department of
Labor took immediate steps to comply," Della said in
the statement. "Because two rules were on file for
public inspection on Friday, it was not possible to
withdraw them from publication. Neither of these rules
(Investment Advice - Participants and Beneficiaries and
changes to the Form LM-2 and LM-3) is immediately
effective. The Department is working to identify all
rules that may be affected by the memo and to take the
necessary action."